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NAHB Commends Confirmation of Brian Montgomery as FHA Commissioner

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., issued the following statement regarding the Senate confirmation of Brian Montgomery to run the Federal Housing Administration (FHA):

“NAHB applauds the Senate confirmation of Brian Montgomery as the new FHA commissioner. Having served in this same position under presidents from both sides of the political aisle, he has a firm grasp of the issues and challenges confronting home buyers, renters and home builders. NAHB looks forward to working with the new FHA commissioner to ease regulatory burdens that are harming housing affordability and to make homeownership and rental housing more accessible for hard-working American families.”

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Housing Production Drops 3.7 Percent But Remains Near Post-Recession High

Total housing production fell 3.7 percent in April to a seasonally adjusted annual rate of 1.29 million units after an upwardly revised March reading of 1.34 million, according to newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department. The March report marked an 11-year high for housing production.

The April reading of 1.29 million units is the number of housing units builders would begin if they kept this pace for the next 12 months.

The drop in overall production can be attributable to a decline in the multifamily sector — which includes apartment buildings and condos — after a big uptick in March. Multifamily starts fell 11.3 percent in April to a seasonally adjusted annual rate of 393,000 units. Meanwhile, single-family starts remained essentially flat, inching up 0.1 percent to 894,000 units after an upwardly revised March reading.

“We expected some pullback this month after such a strong March report, but housing starts remain at very healthy levels in April,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “With homeownership rates on the rise, demand for single-family homes should continue to spur production in the months ahead.”

“Single-family starts are up 8.3 percent for the first four months of the year relative to the start of 2017, which is higher than our forecast and bodes well for the rest of the year,” said NAHB Chief Economist Robert Dietz. “However, builders must manage supply-side hurdles, such as ongoing building material price increases and shortages of land and labor, to meet growing housing demand. Lumber prices continue to rise, with recent increases adding more than $7,000 to the price of an average single-family home.”

Regionally in April, combined single- and multifamily housing production increased 6.4 percent in the South. Starts fell 8.1 percent in the Northeast, 12 percent in the West and 16.3 percent in the Midwest.

Overall permits — which are a sign of future housing production activity — inched down 1.8 percent in April to a seasonally adjusted annual rate of 1.35 million units after a post-recession high in March. Single-family permits ticked up 0.9 percent to 859,000 while multifamily permits fell 6.3 percent to 493,000 after a 20.4 percent jump in March.

Permits rose 12 percent in the South. They fell 4.4 percent in the Midwest, 13.2 percent in the West and 31.9 percent in the Northeast.

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NAHB Now Accepting Applications for the 2019 Best of 55+ Housing Awards Competition

The National Association of Home Builders (NAHB) 55+ Housing Industry Council is now accepting applications for the 2019 Best of 55+ Housing Awards. All builders, developers, architects, marketers and designers of 55+ housing are invited to enter this prestigious awards competition.

The Best of 55+ Housing Awards honor the people, companies, projects and programs that set the bar for innovative marketing, industry-leading design and construction, and community lifestyle features that appeal to all life stages. 

“The Best of 55+ Housing Awards are the sector’s most influential national awards,” said Chuck Ellison, chairman of NAHB’s 55+ Housing Industry Council and vice-president-Land of Miller & Smith in Mclean, Va. “The awards not only recognize the country’s top builders and developers in the 55+ housing sector, but also highlight the newest and most innovative housing trends for mature buyers and renters.”

All applications must be submitted online by Aug. 24, 2018. For more information, or to access the application platform, please visit www.nahb.org/55plusawards. Complete details, including eligibility requirements, categories and deadlines, can also be found there. Both NAHB members and non-members are eligible to enter. Finalists will be announced Nov. 2, 2018, and the winners will be announced at an awards ceremony on Feb. 19, 2019, during the NAHB International Builders’ Show in Las Vegas.

For additional information, contact NAHB’s 55+ Housing Industry Council at 800-368-5242 x8130 or [email protected].

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Builder Confidence Climbs to 70 in May

Builder confidence in the market for newly-built single-family homes rose two points to a level of 70 in May after a downwardly revised April reading on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). This is the fourth time the HMI has reached 70 or higher this year.

“The solid May report shows that builders are buoyed by growing consumer demand for single-family homes,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “However, the record-high cost of lumber is hurting builders’ bottom lines and making it more difficult to produce competitively priced houses for newcomers to the market.”

“Tight housing inventory, employment gains and demographic tailwinds should continue to boost demand for newly-built single-family homes,” said NAHB Chief Economist Robert Dietz. “With these fundamentals in place, the housing market should improve at a steady, gradual pace in the months ahead.”

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

The HMI chart gauging current sales conditions increased two points to 76 in May while the indexes measuring buyer traffic and expectations in the next six months remained unchanged at 51 and 77, respectively.

Looking at the three-month moving averages for regional HMI scores, the West and Northeast held steady at 76 and 55, respectively. Meanwhile, the South and Midwest each edged down one point to respective levels of 72 and 65.

Editor’s Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be found at nahb.org/hmi. More information on housing statistics is also available at housingeconomics.com.

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NAHB Now Accepting Applications for Multifamily Pillars of the Industry Awards Competition

The National Association of Home Builders (NAHB) opened its general call for entries for the Multifamily Pillars of the Industry Awards competition. Multifamily owners and developers, builders, property managers, architects, interior designers and multifamily industry professionals are invited to enter the competition.

The awards highlight excellence in apartment and condominium design and development, interior merchandising and superior property management and marketing. Since its inception in 1990, the Pillars Awards program has earned its reputation as the most prestigious awards program of its kind.

“The Pillars Awards program is a great way to honor those in the industry who use innovative approaches to design and décor and who have the consumer in mind when building their communities,” said Steven Lawson, president of The Lawson Companies in Virginia Beach, Va., and chairman of NAHB’s Multifamily Council. “We expect to receive a wide variety of multifamily communities entered in the competition, and it’s always fascinating to see how the market varies across the country.”

All applications must be submitted online by Aug. 24, 2018. For more information, or to access the application platform, please visit www.nahb.org/pillarsawards. Complete details, including eligibility requirements, categories and deadlines, can also be found there. Both NAHB members and non-members are eligible to enter. Finalists will be announced Nov. 2, 2018, and an awards luncheon will take place on Feb. 19, 2018, during the NAHB International Builders’ Show in Las Vegas.

For more information, call NAHB’s Multifamily Council at 800-368-5242 x8207 or email at [email protected].

For more information on the NAHB Multifamily program, please visit NAHB Multifamily: https://www.nahb.org/en/members/committees-and-councils/councils/multifamily-council/nahb-multifamily.aspx.

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Real Estate Insights: Appraiser Trends

In recent years, NAR has heard concerns regarding a perceived shortage in appraisers, long turnaround times for appraisals, higher and/or rush fees in certain areas, and difficulty in bringing new appraisers into the profession. Earlier this year, NAR released the Appraiser Trends Study. Ken Fears talks with us about the survey’s findings in this episode. 

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Appraisal Exemption in Disaster Areas

Federal agencies announced they have eased Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) appraisal requirements for areas of Florida, Georgia, Puerto Rico, Texas, and the U.S. Virgin Islands that have been declared major disaster areas by President Trump due to Hurricanes Harvey, Irma, and Maria.

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